Why Short Sales can be Bad Deals
There are many “short sales” listed on the MLS in Massachusetts.
Some buyers hear “short sale” and assume they’ll get an outrageously advantageous sale (as suggested by the photo above).
But a short sale itself does not guarantee good deal for buyers. Just because the owner owes more on the property than the home is currently worth does not mean that the home is a compelling buy.
Most short sale listings appear on the MLS well BEFORE the lender approves the sale.
Think about it: the owner needs to submit an offer to the lender before lender can be asked to allow the short sale. And with lenders dealing with countless thousands of bad mortgage loans, response times are often measured in months, not days.
So there’s a good chance that your offer on a short sale listing may consume many weeks of your time with no guarantee that the lender will approve the sale at the price offered by you. Quite a few attempted short sales end in foreclosure.
Location, condition and price make for a good or bad deal, not the seller’s motivation for the sale, or the degree of his financial distress.
A short sale of a home in a bad location or with lots of structural defects may end up being a poor purchase.
So don’t let your pursuit of a good deal blind you to whether the home is really right for you.
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